No more serious allegation has been made against a sitting prime minister in modern times

William Hague

The allegations - dismissed by Downing Street as old and unsubstantiated - are contained in a new book by political writer Andrew Rawnsley of The Observer, extracts of which are published in the Daily Mail.

The book says that Mr Blair believed he would be forced out of office over the affair, only six months into his term of office.

According to the Mail, Mr Blair told a friend at the time of the crisis: "This is the end ... they'll get me for this."

'Twin lies'

Mr Ecclestone's gift, in 1997 before the May election, proved an embarrassment for Mr Blair, who faced allegations that the money had influenced the government's decision to seek an exemption later for Formula One from a European tobacco advertising ban.

Bernie Ecclestone was given his donation back

The affair became known as the "cash for favours" row.

Labour followed the advice of standards commissioner Lord Neill and returned the money.

But Mr Rawnsley says Mr Blair and Mr Brown were embroiled in two lies over the donation from the multi-millionaire racing chief. The allegations are:

• Mr Brown told BBC Radio 4's Today programme he knew nothing about the donation, but admitted privately afterwards that he had lied, saying: "If this gets out, I'll be destroyed."

• Mr Blair claimed he had sought the advice about the �1m donation from Lord Neill before any journalists had been in touch. In fact, the prime minister contacted Lord Neill only after reporters began to break the scandal. And his letter asked for advice about a second offered donation, not the first, according to Mr Rawnsley's book.

Hague's challenge

Conservative leader William Hague challenged Mr Blair to respond to the claims by making a public statement.

This is a second-rate mix of re-heated allegations

Downing Street spokesman

He said that saying the claims were old was not the same as making a specific denial of the points. The government must say whether Mr Blair and Mr Brown misled Parliament and the public, he said.

"No more serious allegation has been made against a sitting prime minister in modern times," he said.

It was vital that the government cleared the matter up, said Mr Hague.

Conservative frontbencher Andrew Lansley is writing to Lord Neill, asking him to reconsider the advice given and whether Mr Brown and Mr Blair had misled him.

'Re-heated allegations'

Downing Street dismissed the allegations and ridiculed the Daily Mail report.

A spokesman said the headline about Mr Blair lying was misleading and was "singularly unsubstantiated by the rest of the article".

It is... not the most important thing which is before the British people

Margaret Beckett

He added: "This is a second-rate mix of re-heated allegations that were made at the time plus some colourful quotes that add up to nothing."

Liberal Democrat leader Charles Kennedy said clarification was needed: "Obviously I do not know the truth or otherwise of these allegations. I am quite sure the prime minister, as a truthful person, has not misled people, but if he has been misled he will want to find out why."

'Fuel tax diversion'

But a spokesman for Gordon Brown said the book told the country "absolutely nothing" about what happened.

This is the end ... they'll get me for this

Tony Blair, quoted by Andrew Rawnsley

And Leader of the House Margaret Beckett said she suspected the reports were an attempt to stop people talking about the real, underlying issues about fuel tax.

"I think it is extraordinary the story is in the papers. It is a very old story and not the most important thing which is before the British people."

Mr Rawnsley said his book was based on hundreds of interviews and extensive research into the apex of government.

He said when Mr Blair used a television interview to apologise for the scandal, it diverted attention from the inconsistencies in his story.